Ask SmallBiz: Grid Saturation

October, 2012

Q: I’d like to put in a solar-electric system to reduce my business’ energy costs, but I’m concerned about grid saturation. How does it affect me?

A: Distributed solar power energy in Hawaii has reached levels unprecedented elsewhere in the United States. This is largely because Hawaii businesses have embraced photovoltaic solar power as a reliable way to reduce rising electricity costs. However, many areas are running up against the grid-saturation limit, which is the threshold at which the utility becomes concerned about the amount of renewable energy on a particular circuit. On Oahu, Maui and Hawaii Island, this limit is 15 percent of a circuit’s peak load.

Commercial PV systems are larger than residential systems, so areas with many commercial buildings have approached the limit faster. Once the 15 percent threshold is reached, a business that wants to go solar may be required to pay for a utility consultant to conduct an interconnection requirements study, which determines if upgrades to the utility’s infrastructure are required to safely connect a new PV system to the grid. In general, these studies and required upgrades, if needed, cost tens of thousands of dollars and take several months, but an experienced contractor can help a business understand and manage the process. For most commercial-property owners, however, grid saturation in their area will add time, cost and uncertainty to their PV projects.

Your Circuit’s Saturation Level

For a quick look at circuit saturation in your area, consult the power companies’ online maps (see box). Most businesses statewide should expect to find their circuit at or above 15 percent. However, since these maps do not keep up with reality on the ground, businesses should also consult with their utility directly (HECO: 543-4760, MECO: (808) 872-3266, HELCO: (808) 327-0519) or with an experienced solar company to determine the true status of their circuit.

Often Still Worthwhile

Uncertainty and misinformation have led many businesses to believe that PV systems are too costly on circuits above the 15 percent threshold. This is not always the case. Often, even with the added cost and time of a study and upgrades, a business can still expect an attractive return on its investment within a few years.

Race to Interconnect

Grid space is allocated on a first-to-interconnect basis. Completion of commercial PV systems can take many months due to the permitting, procurement and other stages of installation, and even longer if a study and upgrades are required. So act quickly if your business wants to go solar.